"Fantastic! Not only did our salespeople do a good job in meeting the sales budget this year, but our production people did a good job in controlling costs as well,\" said Eric Hogan, president of Pacific Company. \"Our $18,3CID overall manufacturing cost variance is only 1.2% of the $1,536,DDU standard cost of products made during the year. That's well within the 3% parameter set by management for acceptable variances. It looks like everyone will be in line for a bonus this year.\" The company produces and sells a single product. The standard cost card for the product follows: Direct labor. 1.4 direct laborhours at $16 per direct laborhour '- 'v'ariable overhead; 1.4 direct labor-hours at SEED per direct labor-hour '- Fixed overhead, 1.4 direct labor-hours at $5.00 per direct labor-hour '- -_ 51.2o Standard cost per unit - The following additional information is available for the year just completed: I The company manufactured 305330 units of product during the year. A total of 64,DDD feet of material was purchased during the year at a cost of $8.55 per foot. All of this material was used to manufacture the Ett units. There were no beginning or ending inventories for the yea r. The company worked 43,5D direct labor-hours during the year at a direct labor cost of $15.80 per Overhead is applied to products on the basis of standard direct la borhours. Data relating to manufacturing overhead costs follow: Denominator activity level (direct labor-hours) 35,000 Budgeted fixed overhead costs S 210,000 Actual variable overhead costs incurred S 108,000 Actual fixed overhead costs incurred S 211,800